Chapter 11

Food Before Fuel: Issues and Price Effect

Zibin Zhang and Michael Wetzstein


Fuel-ethanol expansion contributed to the recent volatility in agricultural commodity prices, causing a price bubble. Results indicate decentralized competitive markets will mitigate any persistent price volatility. Policies should then be directed toward preventing the occurrence of price bubbles and, if they do occur, diminishing their magnitude.

Total Pages: 109-113 (5)

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